anything or anyone that is white on the inside but brown on the outside
chicanos and other decendents of brown spanish speaking people that can't or won't speak spanish, act white, and are ashamed of their heritage

A coconut is a person who like the fruit, is white on the inside yet brown on the outside. Eg. Indian This person may like to party, drink alcohol,have boyfriends, dress in westernised clothing despite their asian appearance and upbringing.

Ed: Hey, is Sandeep (the Coconut) going to the party?
Josh : Yeah he said he's not going to temple this week.